Individuals who participate in a health plan with a high
deductible are permitted a deduction for contributions to
HSAs set up to help pay the individuals’ medical expenses
(Sec. 223). The limit on the contribution deduction is
subject to an inflation adjustment each year. For 2015, the
annual limit on deductible contributions is $3,350 for
individuals with self-only coverage and $6,650 for family
coverage.

To be eligible to contribute to an
HSA, individuals must participate in a “high deductible
health plan,” which is defined as a health plan with an
annual deductible that is not less than a certain limit each
year and for which the annual out-of-pocket expenses,
including deductibles, co-payments, and other amounts, but
excluding premiums, does not exceed a certain limit each
year (Sec. 223(c)). These limits are also subject to annual
inflation adjustments. For 2015, the lower limit on the
annual deductible under a high-deductible plan is $1,300 for
self-only coverage and $2,600 for family coverage. The upper
limit for out-of-pocket expenses is $6,450 for self-only
coverage and $12,900 for family coverage.

The winner of The Tax Adviser’s 2014 Best Article Award is James M. Greenwell, CPA, MST, a senior tax specialist–partnerships with Phillips 66 in Bartlesville, Okla., for his article, “Partnership Capital Account Revaluations: An In-Depth Look at Sec. 704(c) Allocations.”

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